Financial Spanx to squeeze the most into Queenagers’ pensions

Mid-life is an important time to pay attention to your pension and make sure you’ll have the money you need for the future you want

Shocker alert – did you know a man’s pension is typically 35% bigger than a woman’s at the same age? Queenagers, it’s time to get your financial spanx on to sort out your pensions ‘wobbly bits’.

Have you taken time out of work to care for children, relatives, or due to health issues (including the menopause)? Got divorced? Then your retirement plans need probing (and fixing) for shortfalls.

“Women face a more uneven financial journey than men,” says Laura Suter, head of personal finance at AJ Bell. “These financial wobbly bits – the title of our new report – are often tricky to navigate. For some they will be a minor speed bump while for others they will be a huge pothole.”

Don’t worry Queenagers, we’ve got you. Here’s how to get your pension looking perky.

How do I check what pensions I have already?

This could mean looking back over 20 years or more of different workplace pensions paperwork, plus checking what State pension you’re entitled to.

Contact each of your pension providers – you may be able to do this online – and get an updated valuation for each of your plans, which come in two types:

    1. Defined contribution – you’ll be told a pot size, based on how much you (and your employer if it’s a workplace scheme) have contributed, plus any investment growth.
    2. ‘Gold plated’ defined benefit/final salary – you will be told an amount you’ll be paid each year,      which is often guaranteed and rises in line with inflation.

Find your State pension forecast here. (You’ll need to register for a government gateway account, if you don’t have one already.) In 2023 the full State pension is worth £10,600 a year. If you’re entitled to less, see if you can make a top up.

“Put together a list of your other assets as well,” advises Shelley McCarthy, Chartered financial planner and managing director at Informed Choice,“it can often be more tax efficient to have a range of assets you can draw on to provide an income, including, ISAs, cash, and property”.

What will my future look like and how will I pay for it?

What are your wants, needs, desires and realities in retirement? Here are some examples from Steve Conley, founder of the Academy of Life Planning, of female clients he has worked with.


Child free Jessie works in a job she hates, barely making ends meet. On the horizon awaits a generous defined benefit pension and a mortgage free retirement.  As her financial future is secure, she’s escaping the workplace early to pursue an entrepreneurial later life.


Sandra found her retired husband was getting under her feet. So she retrained as a florist and started a new career in her 50s.


Clara has far more in life savings than her social group. She can’t spend on lavish holidays as her friends can’t afford to go with her, so she plans to gift surplus assets to her kids and charities.

“Figuring out how much you need in retirement to do what you want can seem impossible, but we can break this down into an easy-to-work out number,” says Charlotte Tattersall, financial planner at wealth manager RBC Brewin Dolphin.

    1. Add up how much you spend monthly now
    2. Deduct expenses you won’t have in retirement (e.g. mortgage, commuting costs, children’s university fees if you have them)
    3. Add the rough cost of what you want to do in retirement (hobbies, holidays etc).

Compare this monthly figure to how much monthly income what you have already in pensions and other savings pots can give you. Do you need to increase your savings?

Many people take the tax free cash lump sum (typically 25% of the value) from their pension first, in one go or over a period of time, and then work out how to take an income from the rest. A good guideline is the 4% rule – you can typically sustainably generate an income of 4% a year from your assets. So if you need an income of £30,000 a year, you would need assets of £750,000 (before taking account of the State pension).

How can I boost my pension pot?

1. Grab all the tax relief you can

Pensions give the most generous upfront tax relief of any investment, so max it out.  If you pay in £80, tax relief will top it up to £100. A higher-rate taxpayer could then claim back another £20 on a self-assessment tax return, and an additional-rate taxpayer another £25. Getting £100 in a pension can cost as little as £55.

In a workplace pension your employer contribution, together with the tax relief, should give you an immediate 100% bonus on every contribution you make.

2. Use this rule to stuff your pension

You can now put up to £60,000 a year into a pension, but if you didn’t use up all of your ‘annual allowance’ from the previous three years (when it was £40,000), you can still use what’s left under the carry forward rules.

For example, as long as your personal contributions don’t exceed 100% of your annual earnings, you could pay up to £180,000 into your pension in the 2023/24 tax year – your £60,000 annual allowance from 2023/24 plus (if unused) your 3 x £40,000 annual allowances from 2020/21, 2021/22 and 2022/23.

3. Pay profits into a pension and slash your tax bill

Self-employed? Paying your company’s profits into a pension is a great way to lower your tax bill.

Say your company turns a profit of £20,000. If you pay the entire £20,000 from the company directly into a pension as an employer contribution, the company shouldn’t have to pay any tax or employer National Insurance on it.

Should I get professional pension advice?

Talking things through with someone who is a professional in the field can help clarify your goals. lists qualified, independent, regulated advisers in your area.

Pension Wise is a free service backed by the government that provides a free 60 minute telephone appointment to over 50s to run through their pension options.

Alternatively ask your employer about a financial planning service under the government’s pension advice allowance, which also gives you access to general financial planning guidance.

Red flags – and how to avoid them

If you are divorcing it couldn’t be more important to make sure pensions are factored into the settlement. It happens far too often that women are left struggling and end up having to sell their home in order to fund their living costs in retirement. See our feature on divorce financial planning for more information and details.

“Please do not rely on your spouses’ pension fund or pension income,” says Laura Ripley, Chartered financial planner at BRI Wealth Management.

“You may be entitled to a proportion of your spouse’s pension if they were to pass away but this may be significantly less than the full amount, or none at all,” she points out.

Other red flags include:

  • High charges – see if you could be paying less for your pension by switching it to a cheaper plan or provider.
  • A lot of workplace pensions still have ‘lifestyle’ investing – if you are not intending to buy an annuity, this is unlikely to be the best option.
  • Don’t underestimate how long you will be in retirement – it could be 40 years plus
  • Diversification – have several ‘pots’ of wealth split between pension, property, savings and investments, giving you the most flexibility while paying the least tax.

If you would like to educate yourself about your finances for the future sign up here for the AJ Bell newsletter

We are grateful to AJ Bell for partnering with Noon to focus on financial provision for women in midlife

By Laura Miller


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